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Case from journal
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Reference no. NAC2012
Authors: James J Kennelly
Published by: NACRA - North American Case Research Association
Published in: "The Case Research Journal", 2000
Length: 25 pages
Data source: Field research

Abstract

Kerry Group plc was founded as a farmers co-operative in 1974. Even after Kerry Group went public in 1986, the original co-operative (and its farmer-shareholders) retained control of the corporation with 51 percent of the shares. Now the farmers are being asked to further lower their shareholding in Kerry Group. Based on a proposal that will be voted on today at an extraordinary general meeting of the co-operative, the co-op shareholding would be immediately reduced to 39 percent, with a further dilution to 20 percent. The incentives for individual farmers for voting ''yes'' are substantial, but critics of the proposal have been campaigning for weeks on the issue of ''farmer control'', arguing that selling off the majority shareholding would be a repudiation of the ''co-operative principles'' on which the enterprise, founded by farmers, had been based. The critics need at least 25 percent of the co-operative shareholders to vote ''no'' today to derail the proposal.

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Abstract

Kerry Group plc was founded as a farmers co-operative in 1974. Even after Kerry Group went public in 1986, the original co-operative (and its farmer-shareholders) retained control of the corporation with 51 percent of the shares. Now the farmers are being asked to further lower their shareholding in Kerry Group. Based on a proposal that will be voted on today at an extraordinary general meeting of the co-operative, the co-op shareholding would be immediately reduced to 39 percent, with a further dilution to 20 percent. The incentives for individual farmers for voting ''yes'' are substantial, but critics of the proposal have been campaigning for weeks on the issue of ''farmer control'', arguing that selling off the majority shareholding would be a repudiation of the ''co-operative principles'' on which the enterprise, founded by farmers, had been based. The critics need at least 25 percent of the co-operative shareholders to vote ''no'' today to derail the proposal.

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